57674 Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Rules and Regulations 

only in that it removes this FAR 

exemption. 

There is no reporting or 

recordkeeping requirement established 

by this rule. The rule does not 

duplicate, overlap, or conflict with any 

other Federal rules. There are no 

alternatives that would achieve the 

objectives of the final rule. No 

comments were received on the small 

business impact in response to the 

initial regulatory flexibility analysis. 

Interested parties may obtain a copy 

of the final regulatory flexibility 

analysis (FRFA) from the point of 

contact named herein. A copy of the 

FRFA has been submitted to the Chief 

Counsel for Advocacy of the Small 

Business Administration. 

V. Paperwork Reduction Act 

The rule does not contain any 

information collection requirements that 

require the approval of the Office of 

Management and Budget under the 

Paperwork Reduction Act (44 U.S.C. 

chapter 35). 

List of Subjects in 48 CFR Parts 203 and 

252 

Government procurement. 

Ynette R. Shelkin, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, 48 CFR parts 203 and 252 

are amended as follows: 

■ 1. The authority citation for 48 CFR 

parts 203 and 252 continues to read as 

follows: 

Authority: 41 U.S.C. 1303 and 48 CFR 

chapter 1. 

PART 203—IMPROPER BUSINESS 

PRACTICES AND PERSONAL 

CONFLICTS OF INTEREST 

■ 2. Amend section 203.1004 by 

revising paragraph (b)(2)(ii) to read as 

follows: 

203.1004 Contract clauses. 

(a) * * * 

(b)(2)(ii) Unless the contract is for the 

acquisition of a commercial item or will 

be performed entirely outside the 

United States, if the contract exceeds $5 

million, use the clause at 252.203–7004, 

Display of Fraud Hotline Poster(s), in 

lieu of the clause at FAR 52.203–14, 

Display of Hotline Poster(s). If the 

Department of Homeland Security 

(DHS) provides disaster relief funds for 

the contract, DHS will provide 

information on how to obtain and 

display the DHS fraud hotline poster. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 3. Add section 252.203–7004 to read 

as follows: 

252.203–7004 Display of fraud hotline 

poster(s). 

As prescribed in 203.1004(b)(2)(ii), 

use the following clause: 

Display of Fraud Hotline Poster(s) (Sep 2011) 

(a) Definition. United States, as used in this 

clause, means the 50 States, the District of 

Columbia, and outlying areas. 

(b) Display of fraud hotline poster(s). 

(1) The Contractor shall display 

prominently in common work areas within 

business segments performing work in the 

United States under Department of Defense 

(DoD) contracts DoD fraud hotline posters 

prepared by the DoD Office of the Inspector 

General. DoD fraud hotline posters may be 

obtained from the DoD Inspector General, 

Attn: Defense Hotline, 400 Army Navy Drive, 

Washington, DC 22202–2884. 

(2) If the contract is funded, in whole or 

in part, by Department of Homeland Security 

(DHS) disaster relief funds, the DHS fraud 

hotline poster shall be displayed in addition 

to the DoD fraud hotline poster. If a display 

of a DHS fraud hotline poster is required, the 

Contractor may obtain such poster from: 

lllllllllllllllllllll

[Contracting Officer shall insert the 

appropriate DHS contact information or 

website.] 

(3) Additionally, if the Contractor 

maintains a company website as a method of 

providing information to employees, the 

Contractor shall display an electronic version 

of the poster(s) at the website. 

(c) Subcontracts. The Contractor shall 

include the substance of this clause, 

including this paragraph (c), in all 

subcontracts that exceed $5 million except 

when the subcontract— 

(1) Is for the acquisition of a commercial 

item; or 

(2) Is performed entirely outside the United 

States. 

(End of clause) 

[FR Doc. 2011–23782 Filed 9–15–11; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Parts 209, 216, and 252 

[DFARS Case 2011–D033] 

RIN–0750–AH37 

Defense Federal Acquisition 

Regulation Supplement; Award Fee 

Reduction or Denial for Health or 

Safety Issues 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DOD). 

ACTION: Interim rule. 

SUMMARY: DoD is issuing an interim rule 

amending the Defense Federal 

Acquisition Regulation Supplement 

(DFARS) to implement those sections of 

the National Defense Authorization Acts 

(NDAA) for Fiscal Years (FY) 2011 and 

2010 providing increased statutory 

authorities to reduce or deny award fees 

to companies found to jeopardize the 

health or safety of Government 

personnel and adding a mechanism to 

decrease or eliminate a contractor’s 

award fee for a specific performance 

period. In addition, this rule modifies 

the section of the NDAA for FY 2009 

that requires that information on the 

final determination of award fee be 

entered into the Federal Awardee 

Performance and Integrity Information 

System (FAPIIS). 

DATES: Effective Date: September 16, 

2011. 

Applicability Date: This interim rule 

is applicable to any contract entered 

into on or after the effective date. This 

interim rule is applicable to any task 

order or delivery order issued on or after 

the effective date of this interim rule, 

under a contract entered into before, on, 

or after the effective date. 

Comments Date: Comments on the 

interim rule should be submitted in 

writing to the address shown below on 

or before November 15, 2011 to be 

considered in the formation of the final 

rule. 

ADDRESSES: Submit comments 

identified by DFARS Case 2011–D033, 

using any of the following methods: 

• Regulations.gov: http:// 

www.regulations.gov. Submit comments 

via the Federal eRulemaking portal by 

entering ‘‘DFARS Case 2011–D033’’ 

under the heading ‘‘Enter keyword or 

ID’’ and selecting ‘‘Search.’’ Select the 

link ‘‘Submit a Comment’’ that 

corresponds with ‘‘DFARS Case 2011– 

D033.’’ Follow the instructions provided 

at the ‘‘Submit a Comment’’ screen. 


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Please include your name, company 

name (if any), and ‘‘DFARS Case 2011– 

D033’’ on your attached document. 

Follow the instructions for submitting 

comments. 

• E-mail: dfars@osd.mil. Include 

DFARS Case 2011–D033 in the subject 

line of the message. 

• Fax: 703–602–0350. 

• Mail: Defense Acquisition 

Regulations System, ATTN: Meredith 

Murphy, OUSD (AT&L) DPAP/DARS, 

Room 3B855, 3060 Defense Pentagon, 

Washington, DC 20301–3060. 

Comments received generally will be 

posted without change to http:// 

www.regulations.gov, including any 

personal information provided. To 

confirm receipt of your comment(s), 

please check http://www.regulations.gov 

approximately two to three days after 

submission to verify posting (except 

allow 30 days for posting of comments 

submitted by mail). 

FOR FURTHER INFORMATION CONTACT: 

Meredith Murphy, telephone 703–602– 

1302. 

SUPPLEMENTARY INFORMATION: 

I. Background 

An interim rule was published in the 

Federal Register under DFARS Case 

2009–D039, Award-Fee Reductions for 

Health and Safety Issues, on November 

12, 2010, at 75 FR 69360 to implement 

section 823 of the National Defense 

Authorization Act for Fiscal Year 2010 

(Pub. L. 111–84). This interim rule 

includes the review of public comments 

received in response to the Federal 

Register notice for DFARS Case 2009– 

D039. DFARS Case 2009–D039 was 

merged into this case, DFARS Case 

2011–D033, after the NDAA for FY 2011 

(Pub. L. 111–383) was enacted on 

January 7, 2011, in order to combine 

related sections of the NDAAs for FY 

2010 and FY 2011 affecting identical 

sections of the DFARS. 

A. Section 834 Interim Rule 

• The NDAA for FY 2011 was enacted 

on January 7, 2011. Section 834 of the 

statute added to existing statutory 

authorities to decrease or eliminate a 

contractor’s award fee for a performance 

period based on a final determination 

resulting from a DoD investigation of a 

serious bodily injury or death of any 

civilian or military personnel alleged to 

have been caused by a contractor or 

subcontractor. 

• Section 834 applies only to 

contractors and subcontractors at any 

tier that are not subject to the 

jurisdiction of U.S. courts. 

A contractor’s award fee is affected if, 

after the investigation, a determination 

is made that the serious bodily injury or 

death was caused by the contractor’s or 

subcontractor’s gross negligence or with 

reckless disregard for the safety of 

civilian or military personnel of the 

Government. 

Senate Report 111–201, ‘‘to 

accompany S. 3454, the National 

Defense Authorization Act for Fiscal 

Year 2011,’’ associated with section 834, 

stated that investigations under the 

provision would be conducted pursuant 

to existing DoD procedures for 

administrative fact-finding 

investigations, such as those provided 

by Army Regulation 15–6 and the 

Manual of the Judge Advocate General 

of the Navy. Defense Criminal 

Investigative Organizations (DCIOs) 

have procedures in place currently for 

conducting criminal investigations of 

contractor misconduct. In addition, the 

Military Services have procedures for 

conducting administrative 

investigations involving actions related 

to civilian and military personnel. 

Findings of criminal misconduct are 

made at the conclusion of the DCIO 

investigations. 

• The statute also modifies section 

872 of the NDAA for FY 2009 (Pub. L. 

110–417), and requires that information 

on the final determination be entered 

into the Federal Awardee Performance 

and Integrity Information System 

(FAPIIS) (see DFARS 209.105–2–70) and 

will be available to the public. 

DoD has added a provision at DFARS 

209.105–2–70 to provide for the 

inclusion of a final determination of 

contractor fault in the FAPIIS (see FAR 

9.104–6 and http://www.ppirs.gov). In 

addition, the requirements of section 

834 have been included at DFARS 

216.405–2–70, Award fee reduction or 

denial for jeopardizing the health or 

safety of Government personnel, and 

added as a fifth cause for reducing or 

denying a contractor’s award fee in the 

clause at DFARS 252.216–7004. 

B. Section 823 Interim Rule 

The related statutory provision, 

section 823 of the NDAA for FY 2010, 

currently is addressed at DFARS 

216.405–2–70, Award fee reduction for 

jeopardizing the health or safety of 

Government personnel, and the clause 

at DFARS 252.216–7004 (similarly 

titled), which require the contracting 

officer to include in the evaluation 

criteria of any award-fee plan a review 

of contractor actions that jeopardized 

the health and safety of Government 

personnel. As previously discussed, the 

section 823 requirement was 

implemented in the DFARS by DFARS 

Case 2009–D039, published in the 

Federal Register as an interim rule on 

November 12, 2010, at 75 FR 69360, 

prior to its being merged into this case, 

2011–D033, Award Fee Reduction or 

Denial for Health or Safety Issues. 

II. Discussion and Analysis 

The public comment period for the 

interim rule issued under DFARS Case 

2009–D039 closed January 24, 2011. 

Two respondents submitted comments 

on the interim rule. The individual 

comments are discussed below. 

A. Applicability 

Comment: A respondent 

recommended that the rule be applied 

to harm caused to any person (not just 

Government employees). 

Response: Section 823 addresses 

‘‘serious bodily injury or death to any 

civilian or military personnel of the 

Government.’’ Extension of the 

application of this rule to any person is 

outside the scope of the statute. 

Comment: The respondent 

commented that the definition of 

‘‘covered incident’’ should be 

broadened, such that contractors are not 

encouraged to settle out of court and 

thus deny any liability or wrong-doing 

and protect their award fees. 

Response: The rule implements the 

statutory definition of a ‘‘covered 

incident’’ in section 823 of the NDAA 

for FY 2010, which provides 

instructions to the contracting officer to 

reduce the award fee if the contractor is 

found at fault for a covered incident. It 

does not instruct the Government on 

how to proceed with any investigation 

or resolve covered incidents. No 

changes to the statutory definition are 

determined necessary in response to 

this comment. 

Comment: A respondent called for the 

contracting officer to be allowed to 

consider any incident that calls into 

question a contractor’s integrity or 

responsibility when deciding whether to 

reduce or deny award fees. 

Response: Extension of the 

application of this rule to any incident 

that calls into question a contractor’s 

integrity or responsibility is outside the 

scope of the statute; however, other 

parts of the FAR, such as FAR parts 3, 

Improper Business Practices and 

Personal Conflicts of Interest, and 9, 

Contractor Qualifications, and the 

related DFARS parts, provide 

information on dealing with contractor 

responsibility and improper business 

practices. 

B. Documentation 

Comment: A respondent stated that 

contracting officers should be required 

to make a written determination 

regarding decisions to reduce or deny 


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57676 Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Rules and Regulations 

the award fee or decline to do so. The 

statements should also be made 

available to the public, according to this 

respondent. 

Response: FAR 16.401(e)(2) states that 

‘‘(t)he basis for all award-fee 

determinations shall be documented in 

the contract file, to include, at a 

minimum, a determination that overall 

cost, schedule, and technical 

performance in the aggregate is or is not 

at a satisfactory level.’’ The award-fee 

determination does not go into FAPIIS. 

It is the ‘‘final determination of 

contractor fault by the Secretary of 

Defense’’ (section 834(d)) that is 

required to be submitted into FAPIIS. 

While the latter determination impacts 

the former determination, they are not 

the same thing. A requirement for 

public posting of award-fee 

determinations is outside the scope of 

the statute. 

C. Contractor Liability 

Comment: The respondent noted that 

contractors performing on contracts 

within Government facilities have little 

control over the conditions of the 

facilities, the funding to provide for 

repairs to facilities, or the priorities of 

the repairs. 

Response: The DFARS clause at 

252.216–7004, Award Fee Reduction or 

Denial for Jeopardizing the Health or 

Safety of Government Personnel, applies 

only when a direct, causal connection is 

found between a contractor’s actions 

and a serious bodily injury to a 

Government employee. 

Comment: The respondent expressed 

concern that, if a contractor is found 

partially liable under the Occupational 

Safety and Health Administration multiemployer worksite policy for a 

hazardous worksite condition that 

caused serious injury, then the 

contractor’s future/past award fee could 

be reduced or denied. 

Response: The statute as implemented 

in DFARS clause 252.216–7004, 

requires that if a contractor is found 

liable in a covered incident for causing 

serious bodily injury to a Government 

employee, the contracting officer must 

consider reducing or denying the 

relevant award fee. 

III. Executive Orders 12866 and 13563 

Executive Orders (E.O.s) 12866 and 

13563 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). E.O. 13563 emphasizes the 

importance of quantifying both costs 

and benefits, of reducing costs, of 

harmonizing rules, and of promoting 

flexibility. This is a significant 

regulatory action and therefore was 

subject to review under section 6(b) of 

E.O. 12866, Regulatory Planning and 

Review, dated September 30, 1993. This 

is not a major rule under 5 U.S.C. 804. 

IV. Regulatory Flexibility Act 

On November 12, 2010, DoD 

published an interim rule at 75 FR 

69360 implementing section 823 of the 

NDAA for FY 2010. The interim rule 

was immediately effective upon 

publication. Section 823 required 

contracting officers to consider 

reduction or denial of award fee if the 

actions of the contractor or a 

subcontractor at any tier jeopardize the 

health or safety of Government 

personnel. DoD did not prepare an 

initial regulatory flexibility analysis at 

that time because generally, contracts 

awarded to small business are not likely 

to utilize incentive- and award-fee 

contract structures. No comments were 

received on the regulatory flexibility 

section of the notice for the interim rule 

implementing section 823. 

DoD does not expect this interim rule 

implementing section 834 of the NDAA 

for FY 2011 to have a significant 

economic impact on a substantial 

number of small entities within the 

meaning of the Regulatory Flexibility 

Act, 5 U.S.C. 601, et seq. This rule does 

not apply to firms that are subject to the 

jurisdiction of U.S. courts. By 

definition, small businesses are U.S. 

businesses and, therefore, are subject to 

the jurisdiction of the U.S. courts. 

Accordingly, this rule will not affect 

small businesses. An initial regulatory 

flexibility analysis has not been 

performed because this rule will apply 

only to primes and subcontractors at 

any tier that are not subject to the 

jurisdiction of the U.S. courts. DoD 

invites comments from small business 

concerns and other interested parties on 

the expected impact of this rule on 

small entities. 

DoD will also consider comments 

from small entities concerning the 

existing regulations in subparts affected 

by the rule in accordance with 5 U.S.C. 

610. Interested parties must submit such 

comments separately and should cite 5 

U.S.C. 610 (DFARS Case 2011–D033) in 

correspondence. 

V. Paperwork Reduction Act 

The interim rule does not contain any 

information collection requirements that 

require the approval of the Office of 

Management and Budget under the 

Paperwork Reduction Act (44 U.S.C. 

chapter 35). 

VI. Determination To Issue an Interim 

Rule 

A determination has been made under 

the authority of the Secretary of Defense 

(DoD) that urgent and compelling 

reasons exist to promulgate this interim 

rule without prior opportunity for 

public comment. Pursuant to section 

823 of the NDAA for FY 2010, 

contracting officers shall include in the 

evaluation criteria of any award-fee 

plan, a review of contractor and 

subcontractor actions that jeopardize the 

health and safety of Government 

personnel, through gross negligence or 

reckless disregard for the safety of such 

personnel, as determined through 

conviction in a criminal proceeding or 

finding of fault and liability in a civil or 

administrative proceeding. 

Additionally, pursuant to section 834 of 

the NDAA for FY 2011, which became 

effective on enactment, January 7, 2011, 

contracting officers are authorized to 

make a determination of contractor or 

subcontractor fault where DoD has 

reason to believe that a contractor or 

subcontractor may have caused the 

serious bodily injury or death of civilian 

or military personnel and the contractor 

or any subcontractor is not subject to the 

jurisdiction of the U.S. courts. If DoD 

finds that a contractor or subcontractor 

caused the death or serious injury 

through gross negligence or with 

reckless disregard for the safety of such 

personnel, this final determination shall 

be included in award-fee 

determinations, thereby providing an 

important remedy for those situations 

where a DoD contractor or subcontractor 

is not otherwise subject to U.S. court 

jurisdiction. Issuing an interim rule will 

provide contracting officers with this 

important remedy immediately upon 

publication of the rule. However, 

pursuant to 41 U.S.C. 1707 (formerly 41 

U.S.C. 418b) and FAR 1.501–3(b), DoD 

will consider public comments received 

in response to this interim rule in the 

formation of the final rule. 

List of Subjects in 48 CFR Parts 209, 

216, and 252 

Government procurement. 

Ynette R. Shelkin, 

Editor, Defense Acquisition Regulations 

System. 

Therefore, 48 CFR parts 209, 216, and 

252 are amended as follows: 

■ 1. The authority citation for 48 CFR 

parts 209, 216, and 252 continues to 

read as follows: 

Authority: 41 U.S.C. 1303 and 48 CFR 

chapter 1. 


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Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Rules and Regulations 57677 

PART 209—CONTRACTOR 

QUALIFICATIONS 

■ 2. Add section 209.105 to subpart 

209.1 to read as follows: 

209.105 Procedures 

■ 3. Add section 209.105–2–70 to read 

as follows: 

209.105–2–70 Inclusion of determination 

of contractor fault in Federal Awardee 

Performance and Integrity Information 

System (FAPIIS). 

If the contractor or a subcontractor at 

any tier is not subject to the jurisdiction 

of the U.S. courts and the DoD 

appointing official that requested a DoD 

investigation makes a final 

determination that a contractor’s or 

subcontractor’s gross negligence or 

reckless disregard for the safety of 

civilian or military personnel of the 

Government caused serious bodily 

injury or death of such personnel, the 

contracting officer shall enter in FAPIIS 

the appropriate information regarding 

such determination within three days of 

receiving notice of the determination, 

pursuant to section 834 of the National 

Defense Authorization Act for Fiscal 

Year 2011 (Pub. L. 111–383). 

Information posted in FAPIIS regarding 

such determinations will be publicly 

available. 

PART 216—TYPES OF CONTRACTS 

■ 4. Amend section 216.405–2–70 by 

revising paragraphs (b) and (c) to read 

as follows: 

216.405–2–70 Award fee reduction or 

denial for jeopardizing the health or safety 

of Government personnel. 

* * * * * 

(b) The contracting officer shall 

include in the evaluation criteria of any 

award-fee plan, a review of contractor 

and subcontractor actions that 

jeopardized the health or safety of 

Government personnel, through gross 

negligence or reckless disregard for the 

safety of such personnel, as determined 

through— 

(1) Conviction in a criminal 

proceeding, or finding of fault and 

liability in a civil or administrative 

proceeding (in accordance with section 

823 of the National Defense 

Authorization Act for Fiscal Year 2010 

(Pub. L. 111–84)); or 

(2) If a contractor or a subcontractor 

at any tier is not subject to the 

jurisdiction of the U.S. courts, a final 

determination of contractor or 

subcontractor fault resulting from a DoD 

investigation (in accordance with 

section 834 of the National Defense 

Authorization Act for Fiscal Year 2011 

(Pub. L. 111–383)). 

(c) In evaluating the contractor’s 

performance under a contract that 

includes the clause at 252.216–7004, 

Award Fee Reduction or Denial for 

Jeopardizing the Health or Safety of 

Government Personnel, the contracting 

officer shall consider reducing or 

denying award fees for a period if 

contractor or subcontractor actions 

cause serious bodily injury or death of 

civilian or military Government 

personnel during such period. The 

contracting officer’s evaluation also 

shall consider recovering all or part of 

award fees previously paid for such 

period. 

PART 252—SOLICITATION 

PROVISIONS AND CONTRACT 

CLAUSES 

■ 5. Revise section 252.216–7004 to 

read as follows: 

252.216–7004 Award Fee Reduction or 

Denial for Jeopardizing the Health or Safety 

of Government Personnel. 

As prescribed in 216.406 use the 

following clause: 

Award Fee Reduction or Denial for 

Jeopardizing the Health or Safety of 

Government Personnel (SEP 2011) 

(a) Definitions. As used in this clause— 

Covered incident— 

(i) Means any incident in which the 

Contractor, through a criminal, civil, or 

administrative proceeding that results in a 

disposition listed in paragraph (a)(ii) of this 

definition— 

(A) Has been determined in the 

performance of this contract to have caused 

serious bodily injury or death of any civilian 

or military personnel of the Government 

through gross negligence or with reckless 

disregard for the safety of such personnel; or 

(B) Has been determined to be liable for 

actions of a subcontractor of the Contractor 

that caused serious bodily injury or death of 

any civilian or military personnel of the 

Government through gross negligence or with 

reckless disregard for the safety of such 

personnel. 

(ii) Includes those incidents that have 

resulted in any of the following dispositions: 

(A) In a criminal proceeding, a conviction. 

(B) In a civil proceeding, a finding of fault 

or liability that results in the payment of a 

monetary fine, penalty, reimbursement, 

restitution, or damage of $5,000 or more. 

(C) In an administrative proceeding, a 

finding of fault and liability that results in— 

(1) The payment of a monetary fine or 

penalty of $5,000 or more; or 

(2) The payment of a reimbursement, 

restitution, or damages in excess of $100,000. 

(D) In a criminal, civil, or administrative 

proceeding, a disposition of the matter by 

consent or compromise with an 

acknowledgment of fault by the Contractor if 

the proceeding could have led to any of the 

outcomes specified in subparagraphs 

(a)(ii)(A), (a)(ii) 

(B), or (a)(ii)(C). 

(E) In a DoD investigation of the Contractor 

or its subcontractors at any tier not subject 

to the jurisdiction of the U.S. courts, a final 

determination by the Secretary of Defense of 

Contractor or subcontractor fault (see DFARS 

216.405–2–70. 

Serious bodily injury means a grievous 

physical harm that results in a permanent 

disability. 

(b) If, in the performance of this contract, 

the Contractor’s or its subcontractor’s actions 

cause serious bodily injury or death of 

civilian or military Government personnel, 

the Government may reduce or deny the 

award fee for the period in which the covered 

incident occurred, including the recovery of 

all or part of any award fees paid for any 

previous period during which the covered 

incident occurred. 

(End of clause) 

[FR Doc. 2011–23630 Filed 9–15–11; 8:45 am] 

BILLING CODE 5001–08–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR Part 216 

[DFARS Case 2011–D010] 

RIN 0750–AH15 

Defense Federal Acquisition 

Regulation Supplement; Increase the 

Use of Fixed-Price Incentive (Firm 

Target) Contracts 

AGENCY: Defense Acquisition 

Regulations System, Department of 

Defense (DoD). 

ACTION: Final rule. 

SUMMARY: DoD is issuing a final rule 

amending the DFARS to increase the 

use of fixed-price incentive (firm target) 

contracts, with particular attention to 

share lines and ceiling prices. 

DATES: Effective date: September 16, 

2011. 

FOR FURTHER INFORMATION CONTACT: 

Ms. Amy Williams, telephone 703–602– 

0328. 

SUPPLEMENTARY INFORMATION: 

I. Background 

This DFARS case was initiated to 

implement an initiative to incentivize 

productivity and innovation in industry, 

as set forth in a memorandum from the 

Under Secretary of Defense for 

Acquisition, Technology, & Logistics 

(USD(AT&L)), dated November 3, 2010. 

The memorandum provided guidance to 

the secretaries of the military 

departments and directors of defense 


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